raises concerns regarding the reliability of financial reports and may lead to
misstatements in the inventories and corresponding expenditure accounts.
Additionally, the delay in recording transactions affects budget utilization
monitoring, which could impact decision-making and resource allocation.
7.5 We recommended and the Municipal Treasurer agreed to ensure the timely
consolidation and submission of the SSMI in compliance with Sec. 121 of the
NGAS Manual for LGUs, Vol. 1.
7.6 We further recommended and the Municipal Accountant agreed to conduct a
thorough reconciliation of inventory balances and record the corresponding
journal entries to reflect the correct financial position.
Semi-expendable properties erroneously recorded to Other Supplies and Materials
Expenses - ₱124,614.00
8. Purchases of semi-expendable properties totaling at least ₱124,614.00 were
recorded under the Other Supplies and Materials Expenses account instead of the
appropriate semi-expendable inventory account, contrary to COA Circular 2024-
006, thus, eliminating the required accounting of the receipt and utilization
established through the use of Inventory Custodian Slips and Report on Semi-
Expendable Property Issued, and other reports and registries, which could result
in the misstatements of semi-expendable inventories and corresponding expense
accounts at the end of the year.
8.1 COA Circular No. 2022-004 dated May 31, 2022, provides guidelines for
implementing the increase in the capitalization threshold from ₱15,000.00 to
₱50,000.00. Specifically, Section 4 thereof requires that tangible items meeting the
definition and recognition criteria of Property, Plant, and Equipment (PPE) but
costing below ₱50,000.00 be accounted for in the books of accounts of the agencies
as semi-expendable property.
8.2 To strengthen controls over the semi-expendable property, the forms, registry, and
reports are enumerated in Section 4.7 of the aforementioned Circular:
Form/ Registry/ Report Description Responsible
Person
Semi-Expendable Property To record the acquisition, Supply and/or
Card (SPC) issue/transfer/disposal and Property
the description/information Division/Unit
Semi-Expendable Property To record the acquisition, Accounting
Ledger Card (SPLC) description, custody, Division/Unit
impairment,
issue/transfer/disposal,
repair history, and other
information
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